1. The following data is related to sales and production of the Tarkio Corporation for last year.

Selling price per unit $60.00

Variable manufacturing cost per unit $25.00

Variable selling and administrative expense per unit $6.00

Fixed manufacturing overhead (in total) $50,000

Fixed selling and administrative expenses (in total) $8,000

Units produced during year 10,000 Units sold during year 8,000

Units in beginning inventory 0

Units in ending inventory 2,000

a. How much is Tarkios Gross Margin for last year? Use absorption costing to compute Gross Margin.

b. If Tarkio uses absorption costing, at what amount would it value its inventory?

c. How much is Tarkios Contribution Margin for last year?

d. If Tarkio uses direct or variable costing, at what amount would it value its inventory?